- Brent crude fell more than 2 per cent while major Asian stock markets surged after Washington and Tehran signed an interim peace framework, raising hopes of restored energy supplies and reduced geopolitical risk.
Oil prices retreated and Asian stock markets rallied on Thursday after the United States and Iran signed an interim peace framework aimed at ending months of conflict that disrupted global energy supplies and rattled financial markets.
Brent crude, the international benchmark, fell 2.3 per cent in Asian trading to $77.73 a barrel, reversing gains made a day earlier when US President Donald Trump warned that military action against Iran could resume if Tehran failed to comply with the agreement.
The decline brought oil prices close to levels seen before the outbreak of hostilities involving the US, Israel and Iran earlier this year. Market participants interpreted the agreement as a sign that supply disruptions in the Gulf could gradually ease, reducing fears of a prolonged energy shock, according to news agencies.
The positive sentiment spilled into equity markets across Asia. Japan’s Nikkei 225 climbed more than 2 per cent to reach a record high, while South Korea’s Kospi gained 1.7 per cent. Taiwan’s Taiex also advanced, reflecting investor optimism that the agreement could stabilise global trade and energy flows.
US stock futures pointed to a stronger opening on Wall Street, with contracts linked to the S&P 500 and Nasdaq posting solid gains.
Analysts said investors welcomed the fact that Washington and Tehran reached an agreement sooner than expected, removing one of the biggest sources of uncertainty hanging over global markets.
The memorandum of understanding, which reportedly came into effect immediately, includes provisions for Iran to reopen the Strait of Hormuz and for the United States to lift restrictions affecting Iranian ports. The strategic waterway is a critical artery for global oil shipments, carrying a significant share of the world’s seaborne crude exports.
The conflict had severely disrupted maritime traffic through the strait, creating a shortfall of an estimated 14 million barrels per day in global oil supplies, according to industry estimates. Hundreds of vessels remain stranded or delayed as shipping operators await clearer guidance on safe passage through the region.
Despite the market rally, analysts cautioned that a full recovery in oil flows will take time. Clearing logistical bottlenecks, restoring shipping schedules and addressing security concerns remain major challenges.
Industry groups have also warned that uncertainty persists. Shipowners continue to seek detailed information on transit routes, security arrangements and timelines before resuming normal operations in the Gulf.
Market experts said investors are pricing in the expectation of improving conditions, but the physical restoration of energy supply chains could take weeks or even months.
For now, however, financial markets appear to be focusing on the prospect of de-escalation. Lower oil prices and rising equities suggest investors believe the agreement could mark the beginning of a return to stability in one of the world’s most strategically important energy regions.
